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It’s a Business Deal – Employer Employee Relationships
“The Indy 500 is a business first and entertainment second. The fans many times forget that. We get angry when a team releases a favorite driver or when a sponsor stops sponsoring a team. Sometimes the drivers that are released are those who never got a fair break with the right car or team. Sometimes it is big time drivers that have storied pasts and multiple wins. I will never forget how sad it was when three-time Indy 500 winner Johnny Rutherford tried to get in Indy for the last time and could not get his car up to speed. None of the big teams would sign him and the small teams he was trying to drive for just did not have what it took to make him go fast. Johnny was crushed and choked back tears in the TV interviews that followed. He had given it his all. The team had given its all. The passion was obvious. Same can be said for countless others. For one reason or another, a team releases a driver, and you can feel the disappointment as decisions like these are never easy and certainly never fun. Not fun for the team owners, not fun for the drivers, and most of the time, never fun for the fans. It’s business.
One of the toughest firings at the track I ever witnessed was when the great A.J. Foyt, as a team owner, fired himself. In 1993 after a week of practice, Foyt saw his young hired rookie driver, Robbie Gordon, hit the wall in practice. A.J. knew his time had passed and that it was time to step out of the car, be a team owner, and help his other drivers get their cars safely up to speed. The passion A.J. Foyt displayed as he tearfully retired from racing as a driver in front of the crowd of 100,000 that day said it all. It’s a business deal, you have to do what is best for the team. A.J., like so many other owners, knew the time had come to replace a driver whose time had passed. This time it was him. He was the driver. His time had passed and although he still had the passion, still had the drive, he did what all smart business and team owners do and made the tough decision. Made the decision that was best for the team. If you ever wondered what it is like to see 100,000 adults cry at the same time in the same place, watch that video. I still cannot watch it today without tearing up.
Other times drivers get to drive cars, and it does not seem fair since they have a questionable driving record and others with far superior talent are left standing on the sidelines—but again, it’s a business deal. In Rutherford’s case, it was crushing for his many fans. It made it real. In one bold stroke, it hit me like a ton of bricks. Racing is a business deal from top to bottom. Nothing more, nothing less. Drivers and race teams are not family and they are not friends in the truest sense. They are a business and an employee. Every driver who tries to compete in the Indy 500 has a story. The story revolves around the business deal they can put together. Sometimes these stories are short as the deal they put together never gets them the right car to drive or a car at all. Other times drivers get the right car, the right team, they win races, and, at the end of the deal, walk away on their own terms. But all who go down the road of trying to compete in the Greatest Spectacle in racing know that what they are getting into is a business deal. A business deal that will someday end as all business deals tend to come to a conclusion at some point or another—sometimes the way we like, other times not so.
Lesson Learned
All business revolves around the deals you will put together. You will not get some deals you feel you deserve. Other times you will get deals that surprise you and seem to come out of nowhere. You will learn that some deals are canceled and it doesn’t seem fair. I have learned that one should never take any deal for granted. When in a deal, you give it your all and deliver what you agreed to or more. When you do that, more and better deals will come your way, last longer and be of greater benefit to all involved. One should never take it personally when a business deal comes to an end. It simply means that one of the two parties feel that a change was needed. When it happens, take what you have learned, find a new deal, and win again.
Personal Story
I learned the hard way about the difference between employees, friends, and family. Up to 2008, I had created a staff that was fun to be around. I knew some of them were not the absolute best at what I had them doing, but they got the job done to a mostly acceptable level. Even though I had provided them with an excellent opportunity, I refrained from pushing them to be better and holding them accountable. I was under the illusion these people were my family and friends. I didn’t want to hurt their feelings. I did not want them to quit. I knew they had families and financial responsibilities, and I wanted to help them as much as I could. The wake-up call came when the recession hit. My biggest business was tied directly to the automotive industry. I took a monster hit. Since my “friends and family”—employees—were my friends, I decided to take the personal financial hit so they would not have too. Boy was I dumb. I had to increase my hours by 20 a week to make things work—not my pay, just my hours. No problem. But when I asked “my friends and family” to help me out and put in a few more hours, make a few more calls, and help me do what was necessary to keep things going, all but three of them refused. The three that agreed to do more only would for more money. One, seeing how much I was working, knowing I was making a ton less so that they would even have a paycheck, had the gall to even ask for a raise. When I explained that it was not possible and pointed out all I was doing just to keep things going, she sarcastically replied that that was not her problem, she had put in five years and she wanted more! Wanted more amongst the worst financial crisis we had seen in over eighty years. It finally became as clear as day. These were not my friends and family. These were employees. This was a business deal. They saw it that way. I paid them to do something in a certain number of hours, they did it and went home. It was a new revelation. I immediately saw it as a business deal too. Yes, I could and should treat them like friends and family, but they were not. I put in new rules, new requirements and restructured the way they were paid. A new pay plan where they could actually make more, but they would have to earn it. As a matter of fact, if they wanted to make what they had before, they would have to earn it. No more passes, no more “good enough”. Perform and get paid or don’t and leave. Although three people left instantly—one was my biggest producer—business turned immediately and things got better instantly. The reason? I was running a business, and for the first time I was running it like a business. To this day, things have never been better. Now my policy is the same as being a driver in an Indy Car. Here is your seat. Here is what I need you to do while you are in the seat. As long as you can do that, you get to stay in the seat. The minute you cannot or will not do what that seat requires, you can no longer sit in it. It does not mean I like or dislike you. It does not mean we can’t continue to be friends if it does not work out. It just means this is a business deal. It is about the team and the business. No one person is allowed to dictate how successful a team can be because they will not do what they are paid to do. Here is the best part about my new “it’s a business deal” policy. My employees are happier, more productive, and earn more. I am more happy, my business continues to grow, and I make more money. It hurts me sometimes when I see a favorite driver of mine removed from their seat in the car. Unlike in the past when I did not understand, today I know it is simply a business deal. It is about the survival and growth of the team and not about just one individual. Trust me, it hurts every time it does not work out between me and an employee. There is a certain part of me that feels like I failed. I give every employee everything they need to be successful. I give them the opportunity to be successful. I will work with them and train them without regret. But sometimes tough decisions must be made that are best for the team and not necessarily the individual.
Points to Ponder
One of the biggest mistakes I see businesses make is that they believe that the people they hire to work for them are family and friends. Believing that, they allow their emotions to get in the way and keep people they should not keep who cannot do the job for far longer than they should. As you saw above, I have been guilty of this myself. When one person cannot or will not do his job, it affects all others in your company. You have to ask yourself, is it fair to allow one person to have that power and dictate how much earning and success you and your team will have? It’s always been funny to me how we ignore, avoid, and pretty much disown real family members when we find they are not to our liking. In short, we fire them like employees. But employees who affect our success and livelihood we treat like favorite cousins and let them get away with theft and steal our careers.
Jeff Cowan – Jeff@jcowansprotalk.com
(An excerpt from Jeff’s award-winning book “What I Learned from Attending Over 35 Indy 500’s – Lessons in Sales, Motivation, Leadership, Management, and Life in General”.)
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